CHAPTER ONE INTRODUCTION Background to the Study Ever since the emergence of the post-colonial state in 1960, Nigeria has been saddled with the task of socio-economic transformation. The effort to achieve this task over the years has continually increased the pressure being mounted on the government as it widens the spheres of responsibility even amidst dwindling economic resources. In addressing these problems, foreign aid was adopted by the government as a veritable option for stimulating growth and supplementing the meagre domestic sources of finance of the country. In order to provide the required socio-economic infrastructure, the government partners with some donor agencies that have the capacity to mobilize foreign aid needed to achieve development and reduce poverty. Interestingly, countries such as China and South Korea have benefited from foreign aid at one time or the other and have developed their economies. But countries such as Nigeria which have continued to benefit from various kinds of foreign assistance, yet the pace of socio-economic development remains slow. Anambra is a state in south-eastern Nigeria. It was created on 27th August, 1991 following its bifurcation from the old Anambra State into Enugu and Anambra. The name derived from the Anambra River (Omambala) which is a tributary of the River Niger.1 The state shares boundaries with Delta State in the west, Imo State and Rivers State in the south, Enugu State in the east and Kogi State in the north.2 The indigenous ethnic group in the state are the Igbo and a small population of Igala in Anambra West Local Government Area. According to the National Bureau of Statistics, the population of the state was estimated at 5,527,809 by 2016 based on the 2006 national population census.3 The state occupies a landmass of 4,416 square kilometers.4 Igbo is the language of identity, even though English is the official language. The State capital and seat of government is Awka; Nnewi is the industrial Center and Onitsha, the commercial town with the largest market based on geographical size and volume of goods in the West African sub-region.5 The 21 local government areas of the state are: Aguata, Awka North, Awka South, Anambra East, Anambra West, Anaocha, Ayamelum, Dunukofia, Ekwusigo, Idemili North, Idemili South, Ihiala, Njikoka, Nnewi North, Nnewi South, Ogbaru, Onitsha North, Onitsha South, Orumba North, Orumba South and Oyi.6 1 Even though most Anambra population is rural, the state is experiencing rapid urbanization even with its relatively small land mass. According to National Bureau of Statistics, Anambra State is the 2nd most urbanized state in the country with 62% of its total population living in urban areas, …it has one of the highest population densities in Africa with 947 persons living within every square kilometer.7 There are 179 communities in the state.8 The mainstay of the state economy is commerce and most of the citizens of Anambra (ndi Anambra) are known to be very industrious. The former National Coordinator of National Poverty Eradication Program (NAPEP), Dr. Magnus Kpakol, has rated Anambra state high as the state with the lowest poverty rate among all the states in the country.9 He further noted that the level of private enterprise in Anambra put the state on the top echelon of the efforts by states to eradicate poverty.10 Also, Governor Obiano during the Inaugural Anambra Development Partners Summit (IADPS) in 2017, stated that Anambra State is the fourth largest economy in Nigeria after Lagos, Abuja and Rivers state with the lowest poverty rate in Nigeria.11 Inspite of these, the state still has numerous development challenges. Similar to the economic situation in Nigeria, Anambra State government aspired to develop its economy but could not generate sufficient income to drive its vision. According to Professor Stella Okunna in 2013, Anambra State was relatively poor considering the fact that she occupied about the 26th position in terms of Federal Allocation, getting about only three billion naira (N3bn) every month, which made every development partner very important.12 The State is faced with numerous developmental challenges such as: low internally generated revenue, high recurrent expenditure, over dependence on the federation account for funding of development initiatives, weak infrastructural base, epileptic power supply, high unemployment rate, high level of poverty and natural disasters/ environmental degradation.13 One of the strategies the State adopted to confront these developmental challenges is strategic partnership with development partners or donor agencies. Donor agencies are known for donating, lending, borrowing and partnering with benefiting countries. Foreign aid which is brought by donor agencies can be defined as both grants and concessional loans that have at least a 25% grant component.14 According to the World Bank, foreign aid is usually associated with Official Development Assistance and normally targeted at poor countries in the world.15 Foreign aid, refers to that assistance or support, in this case from a foreign body, accorded to a country which need it to facilitate the pace of its development and socio-economic stability. The Development Assistance 2 Committee (DAC) of the Organization for Economic Co-operation and Development (OECD) asserts that, (foreign) aid (or the equivalent term, foreign assistance) is financial flows, technical assistance, and commodities that are: (i) designed to promote economic development and welfare as their main objective (thus excluding aid for military or other non-development purposes); and (ii) provided as either grants or subsidized loans.16 Foreign aid are largely international transfer of capital, goods, or services for the benefits of other nations. Some donor agencies are part of their government’s foreign ministries, so they can relate with recipient governments as in line with their own government’s foreign policy priorities There are different forms of aids. The main ones are: bilateral, multilateral, tied, project, military, and voluntary aids. It may be necessary to state that not all aids are charitable; most times, they go with stringent conditionality. For instance, the import of the Tied Aid is that whatever support or aid given to a country in need must be spent on goods or services produced in the giver- country. Since 1991, over forty donor agencies have partnered with the state at different times to implement development programs. Some of these agencies include: United Nations Development Program (UNDP), United Nations Children's Fund (UNICEF), World Health Organization (WHO), World Bank, European Union (EU), Department for International Development (DFID), International Federation for Agricultural Development (IFAD), Parenthood Federation of Nigeria (PPFN) funded by Global Funds and the Cater Center. The state government has signed several Program Implementation Agreements (PIAs) with different donor agencies to tackle diverse areas of interest including Emergency Preparedness Response, Survival and Early Child Care, Health and Nutrition, Basic Education, Water, Sanitation and Hygiene (WASH), Child Protection and Participation, Social Policy, Advocacy and Communication. These programs have tried to improve the health, education, governance and agricultural sectors of the state amongst others. They have also provided basic social infrastructure such as drilling of boreholes, hand dug wells, distribution of mosquito nets, construction of classroom blocks, installation of streetlights, among others. All these programs are coordinated by the state Ministry of Economic Planning, Budget and Development which is also charges to oversee the execution of other donor projects implementation in all the state ministries. 3 In assisting to develop the Anambra health sector, donor projects such as the Health and Nutrition Program has been carried out to give attention to the revitalization of the health systems, support to routine immunization, as well as infant and young child feeding. The program launched by the United Nations Children’s Fund (UNICEF) provided the state with cash and supplied assistance worth thirty- eight million, one hundred and forty -five thousand naira (N38,145,000) in 2013.17 Remarkably, Anambra State, today, is polio free and also won the Bill and Melinda Gates Foundation award as best performing state in immunization. In the same year, the Basic Education Program attracted thirty-nine million, one hundred and fourteen thousand, seven hundred and ninety-six naira (N39,114,796.00) as cash and supply assistance from UNICEF to the state.18 The program tried to increase access to basic education and equity, quality standards in basic education and school community systems. The intervention of EU/UNICEF on Water, Sanitation and Hygiene (WASH) project with their cash and supply assistance worth sixty-nine million, nine hundred and eighty thousand, four hundred and seventy- five naira (N69, 980,475.00)19 tried to improve the participatory capacity of the benefiting communities on development projects. It also helped to boost good community project ownership attitude and project sustainability as well as contributed to poverty reduction and community development in the State. The state government overtime has remarkably attracted a growing number of donor agencies with increasing eagerness to site development projects. Anambra is considered by donor agencies such as UNDP, World Bank, European Union as the foremost state committed to reforms